A balance between proliferation and terminal differentiation of epithelial cells is critical for normal epidermal maintenance. The loss of this equilibrium between proliferation and cell cycle arrest leads to basal cell carcinoma (BCC). Recently, the Sonic Hedgehog (SHH) stimulated signaling pathway has been shown to play a significant role in inducing BCC 1-3, however the molecular mechanisms by which SHH acts remain unclear. The focus of this proposal is to identify SHH target genes in the human epidermis, allowing a better understanding of the regulation of epithelial growth and the onset of BCC. This goal is based on the hypothesis that SHH controls the expression of specific target genes which are involved in the onset or progression of cellular transformation leading to malignancy. Identification and further characterization of these genes will help define the molecular mechanisms involving epidermal neoplasia. Specific genes differentially expressed in response to SHH activity will be identified using the cDNA microarray technology. Keratinocytes that express active SHH versus a non-SHH expressing control will be generated using retroviral expression vectors. These genetically altered human keratinocytes can be used to regenerate human epidermis in vivo on SCID mice. Differentially expressed genes as a function of SHH activity identified by this method will be confirmed using northern analysis and in-situ hybridization. As SHH signaling pathway is of critical importance to BCC, revealing its target genes will be helpful in obtaining information regarding mechanisms involved in the onset of the disease and provide potential therapeutic intervention, thereby significantly reducing the incidence of BCC.